Here's The Case For Not Panicking About The Debt Ceiling

We've run a
couple of
stories this morning about rising panic that Washington will
fail to get itself together at the last minute and raise the debt
ceiling before Oct. 17.

Our Executive Editor Joe Weisenthal notes: "There is definitely a gap between how
Washington people feel about the debt ceiling and how
participants in financial markets feel about
it. Financial
markets think it's all just noise. Washington types think it could be
different this time."

There is indeed a gap. But I'm
with the financial markets on this one. So is Eurasia Group's
U.S. practice head Sean West, who says there is an "extremely low
risk" that we hit the debt ceiling. Here's his reasoning:

As the deadline approaches, the Senate will start to get
nervous and pass a clean debt ceiling increase and Boehner will
have to decide if he wants to be responsible for default. My
strong bet is that he doesn’t—he’s chosen bad deals over no deal
on the debt ceiling every time before, and there’s no indication
he’s somehow recently warmed to default or playing recklessly on
this issue given the potential downside ramifications.

This is right. Boehner knows that hitting the debt ceiling
is a political disaster for Republicans. That's why he backed
down on his debt ceiling demands the last time, and the
underlying political dynamic hasn't changed.

Sometimes, Boehner is forced by his caucus's
unreasonableness to court disaster. But most House Republicans
will be grateful if Boehner saves them from a debt ceiling
crisis, so his speakership won't be in danger for averting
one—even if House Republicans feign outrage over his cutting a
deal with Minority Leader Nancy Pelosi to do so.